Vedanta Iron and Steel Limited (VISL) Q1 2027 Earnings Call Transcript

Ladies and gentlemen, good day, and welcome to the first quarter of financial year 2026-27 earnings conference call of Vedanta Limited, Vedanta Aluminium Metal Limited, Vedanta Iron and Steel Limited, Vedanta Power Limited, and Vedanta Oil and Gas Limited. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star and then zero on your touch-tone phone. Please note that this conference is being recorded. Participants connected on the webcast link may change the quality settings to 1080p to watch the proceedings on best quality. Without further delay, I would now like to hand the call over to Mr. Charanvi Singh, Group Head Investor Relations, for his opening remarks.

What are you, sir?

Thank you, Sagar. Good evening, everyone, and welcome to the Q1F5-2027 Howling School, jointly hosted by Vedanta Limited, Vedanta Aluminium, Vedanta Iron & Key, Vedanta Power, and Vedanta Oil & Gas. On behalf of Team Vedanta, I sincerely thank you all for joining us today. To provide a comprehensive and efficient update while making the best use of your time, we are posting a combined call covering all five entities. At first, we have had an opportunity to review the respective earnings presentation, press releases, and the detailed financial statements, which have been filed with the stock exchanges, and are also available on the website of each of the countries. Joining us on today's call are the CEOs and CFOs of each entity, who will discuss their operational and financial performance for the quarter. In the sequence, we will begin with Vedanta Oil and Gas, led by Mr. Jim Gass and Akrit Mundra, followed by Vedanta Power, represented by Rajinder Ahuja and Pankaj Ra, Vedanta RNNC, led by Pankaj Sharma and Avin Jaju. Radhanta Aluminium, represented by Rajesh Kumar and Anup Agarwal, and finally, Radhanta Limited, addressed by Mr. Arun Vishra and Ajay Koyal. Following the updates, we will open the floor for questions. With that, let me hand over the call to Tim. Tim, over to you.

Thank you, Chiam Jit. Namaste. We welcome you to the first quarterly Radhanta Oil and Gas Results Call as a newly listed company. Safety remains our number one priority, and while we continue to strengthen safety leadership, critical risk management, and frontline engagement, our safety performance shows that there is more work to do. At the same time, we have made good progress across ESG. Higher commodity prices supported our Q1 performance, but our focus remains on safe operations. Production, delivery, cost discipline, and execution of our growth portfolio. Our assets continue to demonstrate resilience whilst maintaining natural reservoir decline. Gross operated production average 77.7%. 1,000 barrels of oil equivalent per day during the quarter, comprising 63.1,000 barrels of oil equivalent per day from Rajasthan, 11.6 from offshore assets, and 3.1 from OLP blocks. Working interest production averaged 51.1,000 barrels of oil per day. In Rajasthan, production was supported by well productivity improvement programs, targeted well recovery, and continued operational optimization. Offshore performance benefited from production optimization initiatives, including low-pressure operations and focused well interventions, while OALP production remains stable. Our priority remains to strengthen decline management, accelerate well interventions, improve execution, and maintain high asset reliability. Over the last few years, we have delivered a positive change in our operating cost profile. Particularly for mature tertiary recovery portfolio. The direct operating cost trend demonstrates that cost discipline has been sustained, with full year 27 currently expected to be aligned with the full year 26 levels. This improvement has been driven by optimizing commodity consumption, especially through monitoring well patterns, and by maximizing well gains through targeted rigorous interventions. These interventions are generally faster, lower costs, and more flexible than conventional work-over activity. The focus is to remain strong cost discipline while supporting safe operations, production reliability, and future volume delivery. Cost efficiency must therefore go hand-in-hand with execution and the growth. I will now hand over to Arpit, our CFO, for the financial update.

Good evening, everyone. On the financial results, let me elaborate the key numbers for our performance in the Q1 F527. Our revenue stood at Rs 2,507 crores, which is 3% lower quarter-on-quarter basis, and EBITDA at 1,232 crores, being 16% higher on quarter-on-quarter basis, resulting in an EBITDA margin of 49% for the current quarter. Our unit operating cost for the period was $17.4 per barrel, down 3% quarter-on-quarter basis, despite the production decline and the lower base. The lower cost was driven by efficiencies and optimization in our work-over and well-intervention programs. These initiatives reflect our intrinsic focus on cost leadership with persistent rigor while holistically supporting the reliability matrices. Our profit after tax before exceptional items from continuing operations stands at Rs. 194 crores. The exceptional cost net of tax is Rs. 345 crores towards provision for impairment and one-off exceptional items during the quarter. The fare from continued operations hence stands at a negative 151 crores. Following the transfer of the non-loinant business undertaking that were earlier held in the Earthwild Malko Energy Limited, there has been a one-time profit from discontinued operations which stood at Rs. 1097 crores. Comsequently, the reported fat for the company from continuing as well as discontinued operations stands at Rs. 945 crores. Also, we are pleased to inform and share that we have been assigned a long-term credit rating of AA plus table by both Crystal and Ikra during the recent month, which reaffirms company's strong credit profile and robust ability to meet its financial obligations. The rating further validates the company's continued resilient operational performance and positive growth outlook. Let me cover some of the specifics on the EBITDA bridge. Quarter-on-quarter basis, our EBITDA is higher by 15%, which is supported mainly by the brand prices, which were 50% higher quarter-on-quarter basis. This was offset by lower volumes due to the natural decline as one of the key reasons. While year-on-year, our EBITDA remains flat. For the closing remarks, I now pass on to our entrance to your gym.

Thank you. Overall, the quarter has had a steady performance. The company continues to focus on volume delivery, on capex projects and infills, keeping our costs low, and building our exploration and development pipeline, all built on a strong foundation of safety and environment. Thank you. I will now pass it to Mr. Rajinder Ahuja, CEO of Vedanta Power, for insights on their Q1 performance of power entity.

Thank you, Jim, and good evening, everyone. The quarter marks an important milestone in our journey with the Vedanta power becoming dreamers' entity, effective 1st May, 2026. As a stand-alone power business, we now have a greater strategic focus, sharper accountability, and a stronger platform for long-term value creation in power sectors. To give a brief overview of power landscape, India has recorded an all-time high power demand of 271 gigawatts in May 2026. To support this, Vedanta Power is India's fifth-largest private thermal company with 4.2 gigawatts current operating assets. Aims to reach at 4.8 GigaWatt by the end of the financial year. Further, we are working on plan to add around another 7.2 GigaWatt, starting from FY20, FY30 onwards, it will start getting kicked in. Fuel and volume security remains a key focus area for us. Today, approximately 74% of our total volume is secured through medium and long-term PPAs. While 85% of our coal requirement is backed by long-term coal linkage that provides a good, strong stability and visibility of the revenues and the costs. Coming to quarterly performance, Vedanta Power delivered a resilient operational performance. During Q1, FY27, we achieved sales of 5,224 million units, up 38% YOY basis, and revenue increasing 31%. to 2607 crores. Meenakshi Energy delivered highest ever quarterly EBITDA of 112 crores, backed by the highest sale volume of around 1350 million units. Despite import coal prices increasing by over 60%, our team on ground has an exceptional work by containing the coal cost by 12% on YOY basis. This was achieved by replacing the imported coal with Indian coal, and this time, when we are talking, the team was able to consume around 65-70% of Indian coal in their operations. Our plan to achieve 100% domestic coal at Penoxie remains on track, which will improve our cost competitiveness and margins way forward, further insulating us from the geopolitical risk. Nalvandi Sabo improved its plant availability to 86% from 77% on a QOQ basis and achieved highest biomass co-firing of 7.9% which is highest among the NCR region power plants. The ash utilization remains 94% with increased air sale revenue to 9 crores. Yashigura maintains stable operational performance. However, we receive favorable regulatory outcome in short supply matter with potential refund of 300 crores in days to come. And also, we have got positive order from the State Regulatory Commission for recovery of air sales. As caused by up to 40 growth annually. These positive outcomes are expected to support this future cash flow. As Shakti, despite the operation disruption, the team has demonstrated tremendous resilience, and we remain focused on restoring unit 1 and completion of unit 2, which will be key for our growth catalyst for the company. We plan to start Unit 1 by the end of quarter 2 FY27, and Unit 1 remains on track for completion by quarter 4 of FY27. Parallely, we have also notified our insurance provider who are assessing the impact and the claims for Unit 1, which is duly covered for the losses through insurance. Looking ahead, India's power demand outlook remains very strong, and we thank the power is well positioned to capitalize for future opportunities. With that, I now hand it over to our CFO, Mr. Pankaj Shah, who will take you through the financial performance.

Thank you and good evening, everyone. I will briefly cover the financial performance and capital structure highlights for Q1.27. During the quarter, Vedanta Power reported revenue of 2,607 crore, 31% YUI growth, on sales of 5,224 million units, which increased 38% YUI. While EBITDA for the quarter stood at 291 crore, the overall performance was impacted by the Shakti boiler incident. Nevertheless, the business demonstrated resilience through strong operational delivery and reported highest-ever EBITDA at Meenakshi. Pat for the quarter was impacted due to one-time exceptional item of Rs.487 crore. By neutralizing it, Pat before exceptional one-time impact is negative 59 crore. Our balance sheet and credit profile continued to strengthen. During the quarter, Indian rating agencies ICRA and CRYCIL have upgraded our instruments. Our long-term rating remains strong at AA- with stable outlook. We have very healthy cash and cash equivalents of around Net debt remained flattish compared with the previous quarter, reflecting our continued focus on cash flow management and delivery. We also successfully raised commercial paper at 8.25%, demonstrating continued lender and investor confidence in the business. Going forward, our capital allocation priorities remain clear, maintaining liquidity, reducing leverage, enhancing fuel security, and completing our key growth projects, particularly Sakti unit 1 restoration and unit 2 projects. These assets are expected to materially strengthen earnings, cash generation, and return metrics over next 2 to 4 quarters. With a stronger credit profile, improving operational performance and clear growth visibility, we believe Vedanta power is well positioned to deliver sustainable value creation for all stakeholders. I now hand over to Mr. Pankha Sharma for covering Iron and Steel.

Thank you, Pankaj, and good evening, everyone. Let me take you through the performance for the first quarter of FY27 for Veranta Iron Steel. Veranta Iron Steel operates fully integrated business model supported by strategically located mining assets in Odisha, Goa, Karnataka, Liberia. And downstream steel operations in Goa and Bokaro. And this enables value creation across the entire value chain. During the first quarter, we have delivered a strong operational and financial performance with revenue increase of 18% year-on-year and EBITDA growth of 54%. Margin expanded from 11% to 14% and that stood at During the period, steel and iron ore production increased by 4% year-on-year, supported by stable and safe operation, and enhanced efficiencies. In steel business, sellable production stood at 582.80, with robust EBITDA margin of 20%. This was driven by better realization, a favorable export market, and continued cost and operational initiatives. In iron ore business, production increased by 4% year-on-year to 2.6 million tons, and a Vita margin improved by 24% year-on-year, on the back of for better realization and cost efficiencies. Sequentially, the volume were moderated by seasonal impact. During later part of the quarter, on quarter-on-quarter basis, margin lowered due to higher discounts on low-grade ore and elevated ocean freight costs. On the growth front, our expansion projects continue to progress as planned. During the quarter, we received stage 1 forest clearance for Bocaro expansion project. We remain on track to deliver the project by end of financial year. The ductile iron pipe project in Goa is progressing well and is expected to be completed during the later part of the year. I will now hand over to my CFO, Naveed, to take you through the financial performance.

Thank you, Pankaj. Good day, everyone. During the quarter, revenue stood at 3,662 crores, an 18% increase year on year. The company continues to maintain a strong balance sheet with net debt to EBITDA ratio of 1.3x and return on capital employed of 16%. This is also reflected in the credit rating of AA stable by Chris Hill. Net date post-demerger adjustments stood at 2,733 crores aged on June 26. Strong operating cash flows helped fund pre-monsoon working capital requirements and ongoing growth project. Back to you, Makhach.

Yeah, so in conclusion, we have delivered a strong start to FY27 with resilient operational performance, improved profitability, and disciplined balance sheet management. Our ongoing growth project, Expanding Mining Capacities, and Integrated Business Model position us well to capitalize on India's long-term steel and iron ore growth opportunity. We remain focused on creating sustainable value for all stakeholders through operational excellence, responsible growth, and disciplined capital allocation. Thank you. Thank you very much. And with this, I hand over to Radish, CEO of Anunion.

Thank you, Pankaj, and very good evening, everyone, and thank you for joining the Vedanta Aluminium Metal Limited Earnings Update. VAML delivered a strong quarter, driven by industry-leading safety, sustainability, and operational performance. During the quarter, we had only one lost time injury. Environment performance remained robust. With 20% ash utilization contributing to increased dike stays, while our newly commissioned RO facility improved the wastewater recycling and reduced freshwater consumption by 8%. Renewable energy supply from Serentica increased to 198 megawatts, a 60% sequential growth, and we remain on track to achieve more than 371 megawatts of green power by the end of this financial year. WAML delivered a record quarterly performance, achieving all-time high aluminum production of 632 KT, up 5% year-on-year and 3% quarter-on-quarter. Alumna production was 826 KT, up 41% year-on-year. Alumina production was, however, 6% lower than the previous quarter due to stabilization issues in the power plant, red mud filtration, and bauxite handling. Value-added product output rose to a record 389,000 tons in the quarter, up 14% year-on-year, reflecting the continued shift in our product mix towards our goal of 90% share of value-added products. The billet production increased by 18% and the alloy production increased by 38% with respect to the previous quarter. From a market perspective, global aluminium prices have remained buoyant, supported by supply-side constraints. Looking ahead, our focus remains on accelerating growth through ramp-up of Landigarh and increased volume from Balco Portline 3 and sustained cost optimization through additional domestic vauxite. Our captive pole, we have received the mining lease and mine opening permission for Kurloi, and we plan to start the mine in this quarter. Supported by a strong execution discipline, we remain well positioned to deliver a long-term value for all our stakeholders. Thank you. And with this, I hand over to our CFO, WAML, Mr. Anupagarwal, to take you through the financial performance. Thank you, Rajeshji, and good evening, everyone. We closed Q1-FI27 on a strong note. Marking an important milestone for Vedanta Almonium as our first quarter post-demersive. At a headline level, we delivered an all-time high revenue and EBITDA on the back of strong realization, disciplined cost management, and continued operational execution. Revenue for the quarter stood at a record of 21,105 crore, reflecting a 45% increase YOY and a 13% increase quarter on quarter. On the cost side, our hot metal cost in Q1-FI27 stood at $1.698 per ton, lower by 4% YOY, and lower by 3% quarter-on-quarter, despite inflationary prices due to the Middle East disruptions. This is within our guidance rates as communicated in April. Coming to EBITDA, EBITDA was at 10,499 crore, up 134% YOY, and up 24% quarter-on-quarter. Sequentially, EBITDA per ton expanded from $1,511 per ton to $1,804 per ton. This was driven by a combination of volume growth, cost optimization, marketing initiatives, and favorable market conditions. The profit after tax was at Rs. 6597 crore, up over 200% YOY. Our return on capital employed stood at 42% at the end of quarter 1, reflecting our focus on driving profitable growth while maintaining disciplined capital allocation. During the quarter, our balance sheet became even more stronger. Our net debt-to-EBITDA ratio improved from 1.3x to 0.9x. Our cost of borrowing is now at sub-9% and this will improve further in the coming months. We closed the quarter with a cash and cash equivalent of over 6,000 crore. This provides us with a strong liquidity cushion and enhances our financial flexibility. The board has approved an interim dividend of Rs.8 per share this quarter, the very first for Vedanta Argonium. Both Crystal and Ikra have upgraded Vedanta Argonium to AA+, with a stable outlook. This is an important validation of the market's confidence in our balance sheet strength, earnings resilience, and financial discipline. Our guidance on the cost for full year remains unchanged at $1,650 to $1,700 per ton, though in quarter two, the cost may be marginally higher due to the planned power plant shutdowns timed with the monsoon period. On the hedging front, for the balanced year, we are hedged 28% of our volumes at an average of $3,062 per ton. We are confident that our EBITDA run rate will remain resilient across commodity cycles, driven by higher volumes from bulk expansion, increased value-added product and domestic market penetration, and continued cost reduction through backward integration. Thank you. And with this, I hand over to Mr. Arun Mitra for an update on D-Merced Vedanta.

Thank you, Anup. Good evening, everyone. As you will all know that this quarter makes the first recording period of Dimash Vedanta, India's most diversified base metal and specialty alloy company, providing investors with exposure to zinc, copper, silver, lead, manganese, nickel, and ferrotron. I'm pleased to note that in the median quarter itself, since the merger, we have delivered EBITDA of 8,469 crore and PAT of 5,294 crore for the continuing businesses. Let me now walk you through the operational performance of the key business segments. At Zinc India, refined metal production grew 4% year-on-year to 260,000 tons. We achieved lowest ever cost of production at $851 per ton. Silver continues to contribute strongly to our bottom line with 46% share of it. At Zinc International, overall mine metal production was 48,000 tons, including contribution of 3,000 tons from Black Mountain Mines. Amsburg phase 1 production rose 10% sequentially to 45,000 tons. Amsburg cost of production also declined to $1,549 per ton, down 7% quarter-on-quarter, delivering an EBITDA per ton of $900. At BMM, Schwarzburg mine end-to-end contract in lieu of gift substitution has been completed and ramping up on variable cost model. In Ferrochrome business, Packer delivered its highest-ever quarterly ore production up 41% year-on-year to 153,000 tons, surpassing previous best of 113,000 tons in quarter-426. Improvement in finished-goode grade supported by higher market price resulted in 2% higher net sales realization alongside lower cost driven by 100% captive ore availability. This resulted in EBITDA margin improving from $360 per ton up 13% sequentially, also delivering the best-ever quarterly EBITDA of Rs.101 crore. Copper India recorded sales of 53,000 tons up 3% year-on-year, our highest first quarter sales in 8 years. At Copper International Business, rod sales were down 51% year-on-year, as the supply chain in the entire Middle East region was impacted due to geopolitical tensions. Moving to growth projects across the four segments, at Zinc India, for the fertilizer plant, cold commissioning has been initiated. The hot acid leaching plant at Dariva is also targeted for commissioning in the current quarter. The 10 million ton paranam selling reprocessing plant is under construction. And is expected to be completed by quarter 4 of FY28, while the 250,000 tons per annum expansion project of smelter is expected to be commissioned by quarter 2 of FY29. At Zinc International, Hamburg Phase 2 plant is likely to commence operations in August. It will add another 200,000 tons of MIC capacity, taking the total capacity to 450,000 tons per annum. That's practice. Production from Ostapal underground mine is likely to commence in the current quarter, yielding better FG grade and metallic volume. We received a forest clearance stage 1 for Karpa Sai Mahanri's mine and is expected to start operation in H2 of this current fiscal year. At Copper India, phase 1 debottlenecking has augmented installed capacity to 222,000 tons per annum. Further debottlenecking will take this capacity to 229. 1,000 tons per annum. Copper International at our Jebel exploration block in Saudi Arabia, exploration partner has been analyzed, targeting 24 months for the initial phase. To summarize, performance of continuing businesses is demurred Vedanta is on a steady growth trajectory as reflected by a strong quarter one delivery and project commissioning lined up during the year. We remain focused in our pursuit of growth. The demerged Vedanta to a $5 billion EBITDA enterprise by FY30. With that, let me hand it over to Ajay to take you through the financial performance in detail, after which we will be happy to take your questions. Ajay.

Thank you, Arun. Good morning, everyone. We are meeting today for the first quarter results after Vedanta's historical demerging, and that is unlocking significant value with a combined market cap of resulting companies. I want to also clarify that has a demo that has become effective? The TAT numbers that are reported include one month of discounted operations, as per the India's 105. For the sake of like-for-like comparison, we will focus on... I will start briefly with Vedanta highlights. So on Vedanta Limited School So, 21% YOY. So, 23,000. Nearly doubled, rising by 98% of IOI to highest level, 8,469 crores, with a margin of 57% of 985 basis points of IOI. Profit after tax spat grew to 5,294 crores. This is YUI. Again, Vedanta invested 1,148 crores in Groove CapEx while deleveraging the balance sheet by more than 2,226 crores, at the same time delivering a strong ROC of 28%. In Q1, Vedanta's balance sheet remains exceptionally strong with leverage ratio net debt to EBITDA down to 0.3x amongst the best. Vizanta Limited has been rated A-A+. Thank you so much. The round cash and cash equivalent of 19,000 922 crews remains resilient and at the same time growth focused. I will move on very briefly to Vedanta resources, the VRL highlights. VRL's greatest strength is when recognized with the rating upgrades from all three agencies. VRL to WP or WP equivalent, again representing a decade-high rating for VRL. The demorger as we earlier envisioned has significantly enhanced You may have made a note that during the quarter, we have sold 1.3% sneak in Vedanta Limited. And that illustrates the range of strategic levers to accelerate the fast track. We are delivered by 1.1 million. Through a broader 5 billion refinancing program at Vedanta Resources, we are targeting reduction of around 280 basis points in average funding cost at Vedanta Resources. This would lead to more than 1,000 crores of interest cost saving on a yearly basis. We have recently reached 1.7 billion from international online. Average maturity of 8.5 years. Thank you. And that can be serviced. The D-Merger has laid the foundation for next phase of growth, backed by strong VRL balance sheet, focused businesses, and disparate location of capital. With this, I now will hand over to Operator.

Thank you very much.

We will now begin with the question and answer session.

Anyone who wishes to ask a question may press star and then 1 on their touchstone phone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles.

Thank you. Your first question comes from the line of Akhilesh Kumar with MK Global. Please go ahead. Yeah, can you hear me?

Hello.

Yes, sir.

Yes. So, my first question is on EBITDA for the EAML. So, when I try to add the EBITDA given in the slides for Jarsugura and Balko, the total EBITDA comes at close to 10,527 crores, while total reported EBITDA is, as you mentioned, is 10,499 crores.

So, can you explain the difference?

So, that is a small console adjustment actually. The difference that you are talking about now it gets eliminated for the transactions between Valko and Vambo.

Okay. So, okay. So, this is something intercompany kind of stuff, is it?

Yes, absolutely. Yes.

A small one. Okay. My second question is on the aluminum sales made this quarter. So, I appreciate that you have given the aluminum production for this quarter, but earlier you used to give the sales number as well, which is not mentioned in this slide. So, if you can provide that number as well, that would be great.

So, the sales numbers for the quarter is at 615 KT.

615 KT. Okay. Thanks. Thanks for that.

That's it for me. Thank you. Your next question comes from the line of Indraji Dagarwal with CLSA.

Please go ahead. Hi, thank you for the chance. A few questions. First, I'll start with the aluminum business. So our ask rate for alumina production for the last three quarters is almost 1.1 million tons. So how do you achieve the 4.1 million tons for the full year? So how should we look at the trajectory? Will it be more second half heavy? And given the exit run rate of 1Q and what we are doing in July so far, are you confident of achieving that number?

Yeah, so, typically the monsoon months, both for, you know, the power assets as well as the alumina production are slightly difficult months. So, we expect a much... Higher, you know, volume in the H2. If you would have noticed, even the last year, the trends were similar, and this year also, we will follow the same trajectory, and we will meet the estimate which we have given of 4 to 4.1 million tons of alumna production from Langegard.

Sure. Secondly, on purchased alumina cost, despite aluminum non-sequential versus alumina COP going up and alumina integration going down, your alumina cost in aluminum has gone down. So, what has been the delta in purchased alumina cost in this quarter? What we have booked in P&L.

In the day, on a broad level, as you have rightly said, Albuna cost has come down 3% quarter on quarter. And if you recall, even in the last earnings call, they very clearly articulated that but for the higher LME and the higher API, as we go into the second quarter of this financial year, we will start seeing Albuna cost closer to $750. Okay, now. $7.80 is what we reported in quarter one. Now with increased mix, and you would have seen that we have done around 70-72% in quarter one. And with the same captive mix in quarter two and the lower API, we are en route to that 750 number what we talked.

And is there further room for API prices to go down in the subsequent quarters, or we have already bottomed out over there?

See, I can tell you, see, the further reduction will again come as we ramp up Langegard production because, because, because going forward, you know, our captic mix will keep going up and the bought-out albuna will come, keep coming down with it. So, so any reduction from here towards 700, we will have to look at Langegard ramping up and, of course, some of our captic bauxite coming into the play.

Sure. And in 1Q, what was the hedging volume and price at which we had hedged?

Water 1, we had hedged around 293 KT, and the price was 2813.

Sure. One last question to Ajay, if I may. Given the high capex or the growth projects at Vedanta demerged entity, can you assume that most of the dividend would now be from Vedanta aluminum of the five entities in terms of quantum, let's say rupees, crore or dollar kind of terms?

The way to look at Indrajit, I mean, if you look at historically, Vedanta's dividend yield has been quite high. In fact, it doubled it 12-13%. And over the last couple of years, down to 6-7 percentage point. Our last commitment was to go down to normalized yield of almost 5%. That on the combined market capitalization may be 1.54 billion payout on a console basis of all the five business units. Now, you will appreciate that Inderjit's dividends will be a board matter, but one way to model this, look at the combined market capitalization of each business and look at 3% to 5% dividend yield. So, you were right, Vedanta Aluminium being almost at about 18-20 billion out of 35. Practically, one may also assume half the dividend will come from Vedanta Aluminium going forward.

Sure. Thank you. I have more questions. I'll join back.

Thank you. Thank you. Your next question comes from the line of Sumangal Nivatya with GoTek Security. Please go ahead.

Yeah, good evening, and thanks for the chance. First question is to Ajay on the overall capital allocation. So one is, at the VRL level, can we assume that a large part of deleveraging is behind now, given that we've refinanced, and going forward, the focus would be more on growth, or are we expecting further deleveraging from $4.5 billion debt? So one is that, and then at WAML, Just want to understand what sort of debt or leverage we are comfortable beyond which we will consider paying dividends. And the chairman has spoken about expansion plans. At what stage do we start spending towards the next phase of expansion by which we should expect some lower dividends and re-leveraging?

Let's start with the first part first. You write that at VRL, the deleveraging has been accomplished to a large extent. And over the last 3-4 years, debt of 10 billion down to 5 billion as in June 13. Going forward, what is the path forward? What we have last time committed that the VRL debt has come down from 5 billion down to 3 billion. We also committed that Vedanta, India, on a combined basis to de-merger, our leverage 0.9x as of March will be coming down to 0.7 as of coming March on a console basis. Now, when we look at capital allocation policy, the central theme is allocation, not capital necessarily. We don't provide guidance in terms of EBITDA, but one has to model looking at the current run rate. With the current volume, cost, and positionality, and our macro tailwinds in terms of currency and the pricing, the outlook for the AVIDA or Vedanta India on a console basis is at about 9.5 to 10 billion. Our AVIDA to cash conversion is typically 2%. That means we'll be having total free cash flow of roughly 5 billion 45,000 crore at Vedanta India on a console basis. So we don't have to make choices between growth and deleveraging. Going forward, what we are looking at, we will be keep investing for the growth in the current year at about 20,000 crores, maybe the capex across the five entities. We're looking at deleveraging at VR level roughly 2 to 1.5 billion, again 20,000 crores. At the same time, we'll also be rewarding shareholders through dividend. Eventually, Growth, deleveraging and rewarding shareholders should lead to TSR. So, in Sumangal, we don't have to make choices between investing for the growth or deleveraging. Both in the current year can co-exist given robust free cash flows.

Also, I think Sumangal can add, last three years of deleveraging has not caused, unlike other companies, any postponement of a declared capital. Or any intentional slowdown of a capex project that has been announced in the market. Rather, in the last three years of deleveraging, we have initiated much bigger projects without, you know, things like expansion of a million and expansion in zinc, aluminium, completing the bulk of project. ESL, Bokaro, completing that 2 million and expansion project or keep on working on 2 million and expansion project. All these, ZIE phase 2, all these happened in last 3 years. So, these two are as Ajay's correctly said. It is not one or the other, it is one and the other.

Yes, yes, that's very clear. If you can just share some more thoughts on WAML balance sheet and debt levels which we are comfortable and some expansion plans going forward.

I refer to Mr. Anupagra. Thank you.

See, if we look at our financials, as at end of June, the net debt in our books is around 33,000. Okay. Now, for the growth that we are undertaking or we are invested in, we have a capex left of around 7,000-8,000 crore, which we will be spending in, say, 18 to 24 months. That includes Valco, some leftover Lanzigarh augmentation, and the MINES project. Now, coming to the new expansion 3 MTPA. Presently, we explained last time also, as of now, we are on a drawing board. We are in the process of land acquisition, finalizing the technology partners and the packages, and as and when we will have details, we will come to the board. But today, if you ask me, the net debt stands at, sorry, 29,500 crores. The leftover capex to be spent on the growth already announced is around 7000-8000 crore, including Valko, and that is it.

And what would be the, I mean, total capex for 27 and 28, so 7000-8000 and plus some maintenance, right?

Yes, broadly, yes. For this year, it will be around 5,000 crores plus another, say, 2,000 crores of winterage.

Understood. So, is it safe to assume that the next phase of growth, at least since the plans are not yet formed up, will start towards the end of 28 capex and or maybe in 29 only?

As I said, Inderjee, maybe in a quarter or so, we will come back to the market with other details.

Understood. I have a couple of more questions. One on VISL, I just want to understand what are the next key hurdles and milestones we are looking at for starting or completing the expansion of Bukaro Phase 2.

So, for ESL, I will say that, you know, in this quarter, we have received the...

Understood, understood. And just one last question on aluminum again, sorry. What is the difference of delivered price or bought out alumina versus captive? And with CGMI coming in, what sort of cost saving do we expect purely from the captive backside mine?

See, broadly at today's API, you know, and assuming that this middle-lived prices will normally bottom out or will even out, The difference will be to the tune of 50-60 dollars when you look at the big captive almona versus the bought-out almona. Now, this captive almona also has 50% of the imported bauxite. And to address your question that once regimeally starts ramping up, we can expect, say, another 40 to 50 dollars per ton reduction. And it will all depend on what percentage of Sijimali we will be able to ramp up and how soon we will be able to ramp up. The idea is to start it after monsoon. This year we are expecting 1 to 2 million ton and the next year it can be between 6 to 7 million ton.

Okay, got it. So, 40 to 50 dollar at the alumina level, right?

Yes, yes. All numbers I spoke was on the alumina level.

So, but I mean we've just got stage 2 forest clearance CC. So, I think mining leaves and then consent to operate all these approvals can come within the next couple of months and we can start production by fourth quarter. Is that a realistic expectation?

Given the current scenario, yes, we expect we have made good progress in the last quarter in terms of getting up to FC2. Now, the efforts are on. We are working very closely with the government, and this is how we look very positive. The government is also very positive in terms of investments. In the state. So, we are quite hopeful that this is what will happen.

Understood. And just one last clarification. So, all these mines is under VAL. So, what is the transfer pricing to BALCO? And is it fair to assume then all the cost saving etc. will be reflecting more under VAL than BALCO?

Thank you. Transfer is at arm's length, and we are governed by that as regards transfer from the Langega to Valco is concerned. See, just to clarify, now when you are talking about the mines, you know, Balko also has one mine by the name of Barra. So the coal will come from there. Rest all mines are with Vamal, which will be used for Vamal's own use. And coming to Bokside, then the idea is to take it to Lanzigarh and what Rajeshji said that any Elmuna from Lanzigarh to Balko is today also at arms length basis.

So, Mangal, thank you. We have a very long queue of people waiting with you for questions.

Yeah, thanks and all the best.

Hopefully, we can move to the next person in the queue.

Thank you. The next question comes from Sabri with MK Global. Please go ahead.

Yeah, just one question. So, if I look into your oil and gas.

So, my oil prices have gone up by around 30%, my production is down by around 4-5%, but still my revenue has remained flat QOQ, and my EBITDA is also up to 100 crore only because of this increase in stock, whereas my OPEX, etc., everything has remained the same. So, can you just give an explanation for this, why it has remained largely flat QOQ?

Hi, this is Arpit here.

I am the CFO for the oil and gas business. If you see cotton and cotton, given the cyclic nature of our sales pattern, you know, about 85% is the volume that we have sold. And post-monsoon, this will get liquidated as a typical size pattern that we have.

Thank you. The next question comes from the line of Amit Murarka with Axis Capital. Please go ahead.

Hi, good evening. So, just on the hot metal cost. This quarter, I think it's gone down a bit. So, just wanted to understand, like, one, how you kind of, I mean, given the inflation that we were seeing, generally speaking, on fuel cost and power cost in the quarter, what are the factors that have reduced the hot meal cost for you? And secondly, what would be the outlook for the cost going ahead?

Hello. So, see, I already covered. Now, let me first cover for the quarter two, we expect the cost to be marginally higher, and we said that because of the plant shutdowns, and you would recall that during the monsoon period, there are normally some power plants shutdowns. So, the cost will be marginate. Now, coming to the quarter on quarter, see, the cost has come down due to increased captive consumption of alumina. The lower coal price per se. And of course, because we are talking dollar, you can also say that little bit of a rupee cost divided by dollar is also there. Why I am saying this is because as you would recall last quarter also we said that during post this Middle East disruptions, we have been hit by the carbon cost and the furnace oil cost. So on a net to net basis, If you look at our guidance, what did we say? $1,500, $50 to $1,700 and additional $50 to $100 for the Middle East disruption. So, we are very much there in the target and as I stated in my commentary also that we will be within our guidance of $1,600, $50 to $1,700 as we complete the year. Sure.

Understood.

And just a comment that you could give on the lower sales volume while production, as you mentioned, is the highest ever. The sales volume has not inched up in the quarter.

So why was this inventory build up there in Q1?

See, what happens normally at the fourth quarter or the end quarter, there is a tendency to clean up the stock. So, to that extent, if you will see, some 7-8 KT has been added. Otherwise, there has been no addition to the inventory. Because normally, in the year, there is a tendency that we wipe off the inventory lying at the stock and everywhere.

Okay. Okay. Understood. Thank you. That's it for me.

Thank you. The next question comes from the line of Finakin with HSBC. Please go ahead.

Thank you.

Yes, can you hear me? Am I audible?

Am I audible? No, you are audible.

Please go ahead.

Yeah, so can you just walk us through the Sijimali bauxite mine process? So there was a stage 2 forest clearance. What are the approvals from here? What are the timelines you are expecting? You know, to get us an idea of when can we actually start mining and where are the approvals required at national, state, and other agency level?

So, we finally have to get the consent to operate. So, we are getting that, in the process of getting that, and we expect that to happen in this quarter. And as mentioned, after this quarter, monsoon and rain, we plan to start the mine.

Okay. So, just to be clear, the consent to operate is the only approval required, and after that, you can start mining. Yes, understood. And taking forward the process from a regulatory to actual mining, right? What are the activities on the ground? Because I assume this is a virgin mine, you would have to overburden removal, the reparation of roads and everything. So how long a process do you see or work on the ground before you can scale up to, let's say, 4 to 5 million tons of bauxite mining?

So, compared to coal, you know, bauxite is slightly easier to mine and very little overburden and these things are required. And in addition to that, we operate through MDO partners who develop the, who do the, you know, mining for us and deliver the ore. So, we have already appointed the MDO partner for CG Marley, and so we are ready. In fact, the preparation was done at the beginning of the year itself for, you know, as far as the mining activity is concerned. So, as soon as we get the, you know, approval, the mining can start. Got it.

And my last question is on coal. Given that the mining operation permission has been obtained at the Kuraloi coal mine, what is the mine volumes that you expect in F28 and F29? And secondly, if you were to draw a similar parallel for the Ghorgarpali mine, what kind of coal production can we expect over the next two years, F28 and F29?

So, we expect from Kuruloy this financial year to mine up to 2 million tons. And Ghogarpali, we are just evaluating. But this year, I think we will wait when we start the work to estimate.

And Kuruloy can increase to how much come to next year? 8 million tons. You are confident that it can go to 8 million tons next year if you start this year?

Yeah, this year too, and next year, 8 is our current plan.

Okay, got it. Thank you very much, sir.

Thanks. Thank you. The next question comes from the line of Ritesh Shah with Investec. Please go ahead.

Hi, sir. Thanks for the opportunity. Sir, first question on aluminum. Can you help us with the edges for the balanced three quarters by volume and price by quarter if possible?

See, Ritesh, as I said, for the balance 3 quarter, so we are held about 28% at an average price of 3062, and if you are specifically asking about Q2, then we are held about 270 KT, and the strike price is 2830.

270 KT at 2830, right?

Yes.

Hello. Yep, that helps. So second, I just wanted to check on Saudi assets. Have we firmed up the CAPEX? Because I think you did indicate that exploration partner has been finalized. How should we look at the incremental progress over there and the timelines?

So, as of now, we are on the exploration partner finalization, and after that, we will come back and inform you regarding the CAPEX approval for that.

Sure. My third question was on bauxite mix. Going back to aluminum, it has reduced from 66% to 46%. I just wanted to understand on an absolute tennis standpoint, how much are we procuring from OMC right now? What is the corresponding price? And outside of OMC, what's the average price that we are looking at? We're just trying to do the math that once CGMD comes through, how the economics can change.

See, Ritesh, I'll give you some broad numbers.

Okay.

Now, domestic, as you rightly said, we are doing about 46% to 50% of the alumuna that we produce. Now, if you look at the alumuna cost from the domestic bauxite, because OMG or broadly the other bauxite also that we pick up are more or less at the same price. So, we make the El Muna at a cost of around $300. CG Mali also when we begin, we expect that the course will be at a similar level.

Right. So, would it be possible for you to quantify how much is the procurement rate from OMC right now, and has this number changed over the last three, four years?

Ritesh, you are aware that this matter is subject. That is where I did not want to indicate the number because you are aware that we are getting this under the court order as of now. Okay, fair enough.

And last question, I think probably Ajayi can look at. Any particular reason why we are not indicating payout policy for all the companies, though you have indicated pretty good commentary for all the five entities together? Any timelines over there? And secondly, there is an ICD of 960 crores at VISL. How should we look into that?

So, Ritesh, in terms of the payout, I presume you mean the dividend payout, isn't it?

That's right. You may have seen in the last board meeting post-demerge, and all the new four companies also have adopted their own policy on payment of dividends. The key change remains. In the past, our policy was slightly more directive. It was prescriptive. For example, the payout of 30% of the tax or passing on dividend within some time frame. Post-demerger, the key change reveals the policy has changed from being a perspective to more descriptive. And in that case, basically, all the four companies vote will have a far bigger flexibility. So depending upon the need for the capexes, in terms of profit plow back, and the payout, they can decide. Having said that, all the four companies are also cut from the same cloth. So the Vedanta overall group philosophy continues. What we earlier committed that for the parent company, debt will go down from current 5 billion down to 3 billion over two years. And overall, Vedanta India leverage from 0.9x will go down to 0.7. So in summary, overall, one can safely model that 4 to 5% dividend yield on each company's market capitalization is the number what we are targeting for the group.

Sure.

And, sir, on ICD, sir, can you repeat the question?

Sir, VISL has an ICD of 960 crores. I just wanted to understand where is it heading to and what's the interest cost over there. So, this number was 9434 crores March 26. I think it would be because of the demerger, and that number is reduced to 960.

Yeah, that's right. Naveed, can you take this?

Sure. Thanks. So, this is a part of the merger restructuring. There was a waiver of intercompany loans and related interest to the tune of closer to 13,000 crore. And this is the amount which is there in the VISL books after the entire restructuring which was completed.

Sorry, I could not comprehend it. Can you please come again? This number was 13,000 crores. This was waiver of intercompany loans and?

So, out of 13,000 crores, total 14,000 crores, 13,000 crores had been waived of the intercompany loan, and 960 crores stands in the books, which is payable as a part of the restructuring.

And this is 2BRL.

This is true, Vedanta Limited.

It is true, Vedanta Limited.

Okay, fair.

And lastly, would you like to comment on the real estate value unlocking? The PPT mentions about 30,000 crores plus. How should one understand, appreciate this?

At a thematic level, I think it is just the beginning, right? I mean, not the conclusion. And in fact, demands are led to many more restructuring possible. What are we trying to do? And right now, we are looking at multiple assets on Vedanta balance sheet. And they are industrial lands. At the same time, properties at the post location. In Vedanta alone, as in Vedanta limited alone, we got more than 2,000 acres of land. The intention is to demerge those real estate into a pure play company, and that can, again, lead to significant value unlock. The number of 30,000 crore for 3 billion right now is more aspirational. The whole demerger, if you also look at Vedanta's experience, Vedanta's demerger was far more complex. It took us two years' time, particularly in the Indian NCLT farms. Anything between 9 to 12 months is time-free. So the entire de-merger of real estate also will undergo the same kind of rhythm. It is almost a year from now, but our intention remains across the group. Entire real estate, which is additional, not required for the business, will be de-merged into a company, and we intend to forward in that business. If you look around, really large industrial houses, and you can find them, are on the same path.

Sure. This was helpful. Thank you so much. All the very best.

Thank you, Desh. Thank you. The next question comes from the line of Abhishek Poddar with Citadel International Equities. Please go ahead.

Thank you for taking my question. This is regarding Vidhasa. If you can give us some understanding regarding the regulatory approvals required for the restart of Shakti Energy Plant, In terms of what are the bottlenecks there?

And also, if the contractors are already working on the site, or if the work is, you know, dependent upon the utility approvals getting received.

So, if I could understand your question right, the plant is already at the revival. The contractor is already working from almost a month on the revival, and 26% of the revival has already been completed. We are expecting to start the unit by end of September or first week of October. That's the plan. So, as I said, there is no hurdle we are seeing at this moment.

Okay, and do you need any statutory approvals, sir, for this, with the district magistrate or any such approvals?

So, we have already intimated all the authorities before start of work, and the major approvals generally is required from the boiler inspector and defective inspectors, and all have been intimated before start of work, and they are also coming and doing the in-stage inspection. Finally, once the boiler is ready for starting, there will be a natural visit by the boiler inspector for searching for the fitness and then the plant can be started. So I said there is no hurdle.

Understood. And for the Unit 2, also if you can give us some more color in terms of what percentage of completion

what we've done and how the bonus comes in there.

So it is going as per plan. We want to complete all the activities related to Unit 2 by end of this year and that's where we are as of now. We are not seeing any issue further.

I understand. And for the PPAs, for what has been left out in terms of capacity, some understanding there, what PPAs are available and how are you approaching that?

So, we commissioned 700 megawatt at Menakshi and 600 megawatt last year at Athena, right, and out of this 1600 megawatt, we already have tied up 500 megawatt with Tamil Nadu, and recently we have also got one year contract with Kerala, which is taking the total capacity tied up to 600 out of these two plants. We are not very much behind blocking PPAs at any rate. If you look at what we tied up with Tamil Nadu for five years was one of the best rates available among all the PPAs which was tied up last year. And now when we are tying up for Kerala one year, that also is at a respectable rate of 5 rupees 96-97 Pasa. So we are very picky and choosy because Indian power demand is growing and so the market rates are. If you look the difference between last year's dam rate versus this year's dam rate, we are already saying a difference of around one rupee average. So I think it's a good opportunity for us, but we are only looking at all the opportunity very carefully because we want to tie up at a respectable rate only. So I am very hopeful that eventually this year also we should tie up some capacity which is remaining at a right rate. Thank you.

Thank you. The next question comes from Drainav Cheshandeep Singh with Nomura. Please go ahead. Hi, thank you for the opportunity.

My first question is for Vedanta Aluminium. Sir, once you view and listen on the long term, firstly, I have given guidance on, you know, how second quarter and, you know, these couple of quarters will be, but going ahead for the next couple of years. What are the key cost-saving and operational efficiency measures that you are taking, and if you can just quantify, you know, how much value-accurate they will be, that would be great, sir.

Yeah, let me, Rajiv, let me take this question.

See, so we spoke about the hot metal cost of $1,700 per ton in this quarter. Okay, from here, and I specify three, four, sorry? Am I audible?

Yes, I am.

So, on the call, if you look at, say, three, four quarters down the line, we expect the call to go down, say, the voice is echoing from somewhere, I think.

Jasandeep, sir, we request you to self-mute your line when the management is on.

My line is on mute only. Okay, no problem. So, I was saying that in, say, three, four quarters, now, when you look at the call, say, from $1,700 today, we expect a reduction of $175 to $200. And the areas from where the savings will come, one, as and when the Lanziger ramps up, today, we are doing about 70-72%. And with Lanziger ramping up to 5 million tons, we will be closer to 90%. So, that's one. Second, we spoke about Sijimali and the captive bauxite, how once it ramps up and the cost benefits. The third is, once you have, say, Ghogarpali coming into the play, we will start getting the advantages out of it. So, if I were to specify a number, say, on $175 saving, 70% of it will be Eluna plus bauxite, and the balance will be the coal. And we expect in, say, three to four quarters, we should start realizing those savings.

Thank you for this, sir.

So, my second question, again, a little long-term in nature, BALCO has already become net cash, and given your run rate of the bidder, there is massive reliving potential at, you know, with anti-aluminium as well. In line with that, sir, what is, I know you have answered it on a, you know, on a group level, but what is the capital allocation policy that you will be following at Vedanta Aluminium? And if you can just, you know, quantify what will be this year and next year capex at both Vedanta Aluminium and Balco, separately.

See, yes, you are right. See, Ajay actually elaborated it in detail, so I will not get into that because you mentioned it. Now, coming to the capex, as I said, for the year as a whole, FY27, we expect the capex to be around 5,000 crores for this year. 2 to 2,500 will be bulk and the rest will be vaman. And next year also, maybe the capex can be around 3,500 to 4,000 because Balbo will be done and we will be left with only the minus capex.

Sir, sir, is it safe to say that 1.000.000.

So, here we have not included what is the drawing code, that is the, you know, growth. Yes, as and when the 3MTPA comes, and on 3MTPA also, see, Arunji said, Ajay said, no, return leverage below 1. Okay, I don't think, see, the money will come in the way of growth, I'm saying. So as in the way we announce, you know, we will also come with the details on the funding plans. But, but, robust earnings and the leverage below one, I think we're very comfortable even with that three MTP expenses as in when we announce it. So just to give you an idea, see, per tonne setting up an aluminium facility, I can give the numbers for Barco, has been around $2,500 per tonne. So if you set up a 3 million unit, you can easily calculate what will be the capex required. But having said that, the CapEx is also, you know, And initially, the first two years, you are just ordering. So only 10% or whatever is the order cost. That is the money which flows out. The maximum, you know, capex would happen in the third year after you start the project. So that is how the capex, you know, outflow will be there for the growth. And we are very confident, given the earnings which we are having currently, and Arunji also alluded to that. See, Barco has invested 10,800 crores on the growth, and even while it has not reached the full capacity, it is debt-free. So, you can see very easily how much internal rewards can generate. I hope I have tried to answer your question.

Thank you, sir. Thank you so much for this, sir. Just one last question, a little operational one.

Sorry to interrupt. Mr. Singh, sorry to interrupt. We request you to return to this. I'll turn back to you. No worries. Thank you. We have our next question coming from the line of Shubham Jain with Nippon India Mutual Fund. Please go ahead.

Thank you for the opportunity in conversation for the very good result.

I just had one question. Given that Cressel and Nikra have already upgraded Vedanta Limited, while India Ratings continue to maintain an AA- with rating watch, so has management received any specific feedback from India Ratings on additional conditions or any milestone required for rating upgrades?

Any talk for the rating agency?

Shubham, it is only a question of time.

You may have seen the anti-rating upgrade begin with ICRA a couple of months ago, and now Prisif has followed the path. There is no reason why India Rating will be different. Typically, from a rating company's viewpoint, it is a function of the numericus, which is a hard fact, and second is a perception. I think in both accounts, we do foresee that the India Rating soon will approach the rating committee, and even that will become a level A+. So it is only a process and a question of time. That will begin within a week, not even a month.

Okay. Thank you so much.

Thank you. Our next question comes from the line of Ashish Kejriwal with Nuwama Institute of Equities. Please go ahead.

Hi. Thank you, everyone. Thanks for the opportunity. Two quick questions on Balco. One, where we are at the port lamp up at Balco and how we are seeing the trend going ahead and when we can reach the full capacity at Balco. Second thing is, as BALCO has become net cash, and for this 3 million ton capacity also, which we are talking about, that I'm assuming that we are talking about at Vedanta Aluminium standard level, and BALCO may not be participating in that. So what we are going to do with the cash, which is being generated by BALCO, can it be given as a dividend to Vedanta Aluminium, and then it can be passed on to Vedanta shareholders, or what's the thought process on that front?

Yeah, so as regards BALCO ramp-up is concerned, against a plan of 22 KT in Q1, BALCO produced 24 KT from the new port line. As we speak, the rest of the 25% capacity, and this is with the 25% capacity being commissioned. And as we speak, the rest 25% is being commissioned. And this year, we will get a volume close to around 260 or 270 KT from Balco. But having said that, the entire facility will be commissioned or in full production as we exit this quarter. So next year also, we will get another 190 kT from Belko, so that we realize our total volume of 435 kT from Belko expansion. The next question was about what will BALCO do with, you know, the, yeah, so one is that BALCO has some plans to start the Burra mines, so, and there also government has given some very early stage initiatives for coal gasification, so we are exploring all that, all that is on the drawing board, Nothing particular as such as regards the commitment, but these are the options for Belco to grow. In addition, it can grow in the power assets also. We are looking at it, and also the capital restructure or how the cash will be managed. We will take the decision as and when we have that scenario quarter on quarter. Anupji, if you can add. Asif, I'll only add, see, both, because you mentioned 3MTPA, you mentioned dividends. I'm saying, yes, they are prerogative of the board, but I can only tell you all the options are on the table, and why not? BALCO, see, as a structure, and since we are on the drawing board, BALCO can even participate in 3MTPA. I'm saying all options are there on the table.

Okay. Okay. That's great. Thank you and all the best.

Thank you. The next question comes from Rashid with Pity. Please go ahead.

Thank you. My first question is on VRL with the whole, you know, deleveraging, refinancing that you've done. What is the outgo expected for this year and next year?

Okay, so as of June and Rashi, we are in debt at about 5 billion. And for the remainder of the year, we need to pay only interest of 0.3. And we also have to fund KC obligation 0.1. So in summary, in the remainder of the nine months, we need roughly 400 million out of the Vedanta resources. How that can be funded? You may have seen in the current fiscal, none of the Vedanta companies has paid dividends. Vedanta Aluminum just declared a dividend. Out of the current quantum, it is 8 per share. That leads to almost 175 million at Vedanta resources. So in summary, in the limit of the year, the need for cash at VRL is about 0.4 billion and it will be met mostly through dividends. If I look at next year, FY28, right now, we've got a 1 billion of bridge financing. It is a temporary arrangement. If I leave that aside, that will refinance very soon. We need, again, almost a billion at Vedanta Resources. This number in FY29, next year, at about 730 million. So, billion next year, 730 in FY29. Again, it is a combination of the brand fee, almost $400 to $450 million, and the balance $550 to $600, again, will be dividend. So, in summary, through a contractual brand fee and a routine 3 to 4% dividend, VRA will be self-managed.

Sorry, you mentioned an FI20, sorry, this year it was $300 million of interest, and what was the other $100?

The case of funding is at about $100 million.

Okay, and the $1 billion in FY28, how does that break up?

Roughly millions are equally, so the loan repayment at about $330 million, interest again $350 million, and the KCM again about $350 million. So all these three combined, one-third each is almost a billion.

And the brand fee percentage is fixed until when?

It's a long-term contract. The entire grant fee agreement is valid till 2038. All the five companies board has again now done a revised benchmarking in an unbundled format. So practically across three businesses, this rate is 3%. And only in case of power and copper, it is 0.75. So net net for next three years, rate remains unchanged.

When you say three years, FI 30.

27, 8, and 29. So, until March 29, it is fixed. Good.

Okay. Then, just on the ring international business, what kind of cost and volume expectations should one have for the remaining year and going forward?

The volume expectation is immediate goal is to get 300 KT mark and then go to 500 KT mark. So that phase 2 expansion and finally finish at 750 KT mark. So if you look at current 250 KT of concentrated accessing commission, if you add that to 200 KT, we see in a year's time surely attaching 450 KT mark in VJDI. And when it touches 450 KT mark, the cost would come down to $1,200. That's the target that we are following.

But this year, FI 27, what should we think about volume and cost?

It will remain, it will try to, there is some shortfall in the beginning, but yes, we will try to be close to the guidance.

On the cost as well, because the cost appears to be quite high compared to what you provided.

I don't know, but we are surely working towards reducing costs. So we will see. If we have to revise, we will do it in H2, not now.

Rashi, if you have seen, RNG in his commentary has explained the restructured contract at BML, which is aimed at bringing down the cost. So, you can see the transcript where you have explained that BML was having a fixed cost model. Now, it has been brought down to a variable cost model. So, quarter on quarter, you will see a cost reduction. And that's how we are trying to achieve the guidance which has been given for the current financial aid.

Got it. And just one last question for me. For Vedanta Limited, you've given the capital expenditure both on growth as well as safe sustenance for the quarter. What is the target for FY27?

I'll repeat your question.

What happened to Vedanta Limited, what is the growth and sustainable capex targeted for the full year?

So, I'll have the number. So, in terms of Vedanta Limited, which consists of Zinc India, Zinc International, corporate corporate businesses. For the growth capex, the number is almost 7,000 crores. So, 5,000 for Zinc India and 2,000 for the limited businesses. 7,000 growth capex of Vedanta Limited. The maintenance capex is almost 4,000 crores and out of which a significant portion, almost 70% again at Zinc India and balance at Zinc International. So 7,000 and 4,000, that's the number.

Okay, thank you.

Thank you.

The next question comes from the line of Indraji Dagarwal with CLSA. Go ahead.

Hi, thanks for the chance again. Ajay, you mentioned a few times to look at it as a group entity, but still these are five different listed entities and the cash flows will clearly be different. So is it fair to assume that at no point in time we will see any kind of intercompany transactions among these five entities?

Routine RPTs, Inderjee, I think is a norm for any large community.

And I can't think of any example in the country where one large company which has multiple businesses don't have RPTs. Of course, within the RPT compliance and following all the governance requirements. If you're leaning towards any inter-corporate loans and deposits, then the answer is no. So across all the five companies, six companies actually in Vedanta, India, and from Indian entities to Vedanta resources, we are not forcing any kind of inter-corporate loans.

That is comforting. Thank you so much.

Thank you. Thank you.

Ladies and gentlemen, we will take that as the last question for today. I now hand the conference over to the management for closing comments.

Thank you, Sagar. And thank you, everyone, for joining us today and for your continued interest in Vedanta Group Company. We appreciate your time, your engagement, and the thoughtful questions. In case there are any further questions, any queries not answered, on the call, please feel free to reach out to the IR team. With that, we are concluding today's call, and we look forward to speaking with you again at the end of October, which is our Q2 numbers. Thank you, and have a good day.

Thank you, members of the management. On behalf of Vedanta Limited, that concludes this conference. Thank you, everyone, for joining us, and even now, just connect your lines. Thank you.